Platform or "Community" is a relatively new function that serves to improve a VC firm’s offering to portfolio companies. Over the last 15 years Union Square Ventures (est. 2003), First Round Capital (2004) and Andreessen Horowitz (2009) – have differentiated themselves by providing more systematic, tangible value-add through (i) network-harnessing platforms, and (ii) significant portfolio support staff, which both theoretically add value post-close and make their VC firms more attractive to founders. In short, VC firms now believe that in today’s crowded venture capital landscape, it’s the value-add that really makes the difference in winning deals.
The platform role is not uniform across funds. Rather, a Director of Platform will have a different focus depending on the philosophy, priorities, and size of their fund and the needs of their portfolio. Some are strong on content, some on talent. Some rule the event space, and some focus solely on community building. Some wear lots of hats and are spread across a half dozen different areas, acting as a swiss army knife for fund operations and portfolio company network management.
More so, Director’s of Platform / Community greatly struggled with KPIS and measurement of their effectiveness.
To get a clear answer I contacted the VC Platform Community - a membership community of about 200 Heads of Platforms in Venture. As it turns out, they did not have distinct answers to my questions on the role and metrics for performance. As such, I compiled my research from my calls, meetings and readings and this is what I surmised of the role:
Responsibilities:
Focuses: events, marketing, and new initiatives
inclusive of operations, business development, community, content and communications, event planning, talent support.
Manifested in the following ways:
Business Development (by making strategic connections to customers, partners, and acquirers)
Talent (we’ve strategically sourced hundreds of people for our portfolio companies, dozens of which have been hired)
Communications (assisting with strategic messaging and PR)
Events (like a CEO Summit; quarterly workshops for all CTOs, product, marketing, people ops, and ops teams; curated events with Fortune 500s, and one-off portfolio-wide events like a celebration of International Women’s Day)
Portfolio Company Community (a network to share talent, best practices, and resources – with a curated resource database, along with a hundreds-strong Slack team open to any employee at any company)
Size Matters:
Director of Platform is a role that’s constantly evolving based on size, stage and maturity of the companies across our two funds. A CEO of a 200-person company that’s raised $50M, for instance, will need help with different initiatives than a CEO of a 10-person company that’s raised $1M. At 64 companies strong, there’s enough critical mass among our portfolio company marketers, technical teams, people ops professionals, product managers, and others to easily find an answer to a question, or to be pointed in the right direction.
KPIS are Confusing:
“Platform” can be boiled down to this: how do we connect the companies we invest in to our network, or to a network we can access? We keep two end goals in mind: help our companies be successful, and enhance deal flow. Like venture itself, it’s a long-term play with a lot of little wins along the way.
Dan Kozikowski @ FirstMark Capital has found that “qualitative feedback and measuring what you can control, are the best ways to buy social capital with the team and LPs, too.” The consensus shared was that measuring activities such as introductions made to talent and/or corporates, portfolio coverage / attendance at events, the number of successful introductions made to follow-on investors and deals closed off the back of a meeting with the platform team are good data points to work with.
In Conclusion:
The logic of the VC platform model in the context of the overall firm functions as follows: 1) The firm makes investments in post-investment resources or support staff (in red below); 2) these investments then lead to a 2-sided positive feedback loop, in which these resources may lead companies to perform better (IMPACT 2) and also generate better deal flow as a result of the firm’s enhanced brand reputation for supporting founders (IMPACT 1). These feedback loops directly and indirectly improve fund performance, and so the positive feedback loop goes on
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